Effect of digital advertising on the performance of commercial Banks in Kenya

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Abstract

The rise of digital advertising has had profound effects on the advertising industry and
is shaping the advertising experience. Going forward, the effectiveness and low cost
of digital advertising will compel many businesses to rethink the size and makeup of
their advertising budgets. The purpose of this study was to determine the effects of
digital advertising on the performance of commercial banks in Kenya. The research
design employed in this study was a descriptive cross sectional survey design. The
target population of this study was drawn from the marketing and communication
department of all the 42 commercial banks in Kenya and included the marketing and
communication staff (Managers and their assistants) of all the banks. Questionnaires
were the main instrument for collecting the primary data from the respondents. The
study used quantitative analysis to draw inferences and conclusions from the study.
Looking at the extent digital marketing affected the performance measures, the study
established that the banks market segment had improved over time under the use of
digital advertising. The study also found out that digital advertising significantly
affected commercial banks and is moving away from the traditional methods of doing
financial transaction. The study further established that most commercial banks were
shifting from the traditional advertising platforms such as newspapers, television
radio and bill boards to more digital marketing platforms such as website
design/development for bank, email marketing for banks, display advertising for
banks, use of mobile apps for banks, online advertising and social media. This was
promoted by the need to interaction more with customers; reduce the operational
costs, increased technology change and the need to align their marketing with the
bank’s strategic plan. The study concluded that banks market segment had improved
over time under the use of digital advertising, the cost of advertising has gone down,
the uptake of the banks products has increased, the banks market share has increased,
the banks customer base has improved over time, the number of targeted clients
reached is higher and the web traffic rate had increased when using digital
advertising. The study recommends that the management of commercial banks should
increase their investment in digital platforms so as to be in a position to take full
advantage of the digital advertising potential as well as increase the performance of
commercial banks.